Just Released – Report on the Deepwater Horizon Accident

On July 21 the Deepwater Horizon Study Group provided their second progress report to the President’s BP Deepwater Horizon Oil Spill and Offshore Drilling Commission. The Deepwater Horizon Study Group (DHSG) is organized under the auspices of the University of California Berkeley (UCB) Center for Catastrophic Risk Management. The group currently is comprised of 55 experienced professionals, experts, and scholars in the fields of offshore drilling and operations, organizational management, governmental regulatory affairs, system safety and reliability, risk assessment and management, fire and explosion investigation, marine accident investigations, environmental science and affairs, and law among other areas of expertise. They graciously gave us permission to post their report. The full text report is available from the DOE Operating Experience WIKI. You can link to the OE Wiki from the Link section on the right hand navigation bar of this blog.

Our sincere thanks to the DHSG for sharing this report and for the time and expertise they are donating to help understand the Deepwater Horizon catastrophe and prevent such events in the future.

Executive Summary

President Obama tasked the Graham-Reilly Commission with providing recommendations on how to prevent future spills and mitigate their impacts. The University of California, Berkeley (UCB) Deepwater Horizon Study Group (DHSG, has been asked to submit monthly reports of its findings to the Commission and to the public. This second progress report is a sequel to the May 24, 2010 report from UCB’s Center for Catastrophic Risk Management (CCRM, Failures of the Deepwater Horizon Semi-Submersible Drilling Unit, and addresses both “looking back” and “looking forward” issues and recommendations to avoid future spills from deepwater offshore operations.

The DHSG has three major goals: (1) to produce a final report documenting results from the studies of the failures of the Deepwater Horizon Mississippi Canyon Block 252 well drilling project and the subsequent containment and mitigation activities; 2) to serve as advisors to the public, governments, industry, and environmental advocates who want timely, unbiased well informed insights and information regarding the failures and what should be done to reduce the future likelihoods and consequences associated with such failures in ultra deepwater and arctic hydrocarbon resource developments, and 3) to develop a central archive and communications system for data and information accumulated during the investigations that can be used by researchers and others for subsequent analysis and documentation of their investigations, studies, and reports.

The first progress report concluded: “This disaster was preventable had existing progressive guidelines and practices been followed. This catastrophic failure appears to have resulted from multiple violations of the laws of public resource development, and its proper regulatory oversight.” A vast amount of new information has become available since the first report was issued. The DHSG analysis of this information indicates these failures (failures to contain, control, mitigate, plan, and clean-up) appear to be deeply rooted in a multi-decade history of organizational malfunction and shortsightedness. There were multiple opportunities to properly assess the likelihoods and consequences of organizational decisions (i.e., Risk Assessment and Management) that were ostensibly driven by the management’s desire to “close the competitive gap” and improve bottom-line performance. Consequently, although there were multiple chances to do the right things in the right ways at the right times, management’s perspective failed to recognize and accept its own fallibilities despite a record of recent accidents in the U.S. and a series of promises to change BP’s safety culture.

A fundamental premise in the DHSG work is: we look back to understand the why’s and how’s of this disaster so we can better understand how best to go forward. The goal of the DHSG work is not ‘blame and shame’. The goal of this vital work is to help us all to help the public, support our governmental institutions and industrial enterprise, and revisit our environmental stewardship responsibilities in defining how to best move forward – assessing what major steps are needed looking forward to develop our national oil and gas resources in a reliable, responsible and accountable manner.

These major steps forward will require implementation of an effective Technology Delivery System (TDS). An effective TDS endeavors to unify and address the needs and requirements of the concerned public, governmental agencies, industrial–commercial enterprise, and environmental communities so that vital resources and services can be delivered that will have desirable and acceptable Quality (serviceability, safety, compatibility, durability, resilience, sustainability) and Reliability (likelihoods and consequences of Quality) characteristics. This is one of the most crucial and difficult parts of the process. The TDS must be founded on a continuous improvement process to assure that the desired level of Quality and Reliability is achieved and maintained.

The DHSG recommends that TDS be integrated with effective life-cycle (concept development through decommissioning) Risk Assessment and Management (RAM) approaches, strategies and processes that address two key factors: the likelihoods of catastrophic failures (Probabilities of failure, Pfs) and consequences of those failures (Cfs). Risks associated with a given system and its operations are expressed with combinations of Pfs and Cfs. The goal of Risk Assessment is to properly characterize and quantify Pfs and Cfs. The primary goal of Risk Management is to ensure that acceptable and desirable Pfs and Cfs are achieved. RAM explicitly addresses the likelihoods and consequences associated with Intrinsic Uncertainties (natural variability, qualitative and quantitative modeling uncertainties), and Extrinsic Uncertainties (human and organizational performance, knowledge acquisition and utilization). Definition of acceptable and desirable risk, i.e., combinations of Pfs and Cfs, is an interactive social and political TDS process.

The recommended RAM based process is founded on application of three interdependent and interactive approaches to identify and manage risks throughout the life-cycles of deepwater and arctic hydrocarbon exploration and production systems: (1) Proactive (before activities are conducted), (2) Reactive (after activities are conducted to enhance learning and to control or mitigate failures), and (3) Interactive (during activities to ensure that desirable Quality and Reliability are achieved). Three fundamental strategies are used during implementation of these three approaches: (1) reduce the likelihoods of malfunctions (human and system supports), (2) reduce the effects of malfunctions (system Robustness and Resilience), and (3) increase the proper detection, analysis and correction of system malfunctions (Quality Assurance & Control).

Precedents for effective development and application of RAM based approaches and strategies exist in other offshore oil and gas development areas including those of Canada, the U.K., and Norway. These RAM based approaches and strategies are supported with cooperative industry – government – academic research and development programs fostering continued improvement and development of RAM approaches and strategies. These research programs are directly funded with revenues from oil and gas production activities. Effective government – industry ‘leading’ and ‘lagging’ Risk Indicators and sense-making processes have been developed to focus RAM resources on the operations comprising the highest risks. These risk indicators are used to help direct research and development programs that are focused on reductions in uncertainties and increases in reliabilities through technical and organizational improvement processes. Such advanced concepts should be utilized and integrated into the present as well as the next generation of U.S. oil and gas exploration and production processes and practices for deepwater and arctic exploration and production activities.

This report recognizes there is much to be learned from precursors to the Deepwater Horizon accident and identifies steps to be taken to prevent similar accidents in the future. The report focuses on three aspects of all large-scale complex systems failures: technical issues, organization and organizational systems issues, and environmental issues. This report looks back at hypothesized precursors that should be investigated in-depth, and looks forward to ways investigative teams can frame problems in their studies of this catastrophe.

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